sebastoro (26.62)

SMART MOVE FROM UTA

6

Universal Travel Group (UTA) has been under fire in the last weeks, the fire began when a dubios article that some blogger make a few days ago, but the company and the shares has been recovering from the hit and today they make in my opinion a very smart move.

This blogger claim that their auditors was a scam, or a company that nobody knows.....this is what hempton says in his blog;

"has appointed Goldman Kurland Mohidin ("GKM").... I don't know who GKM are – and I will be thrilled if any of my readers can – off the top of their head – name three other companies they audit. Whatever: I think that GKM can take it as read that this is a higher-than-normal-risk audit assignment. And the first thing to do – confirm the existence of that $43 million cash stash"

Well..... looks like the company hear this and today the hired a very good CPA firm today:

"UTG today announced that its Board of Directors, in consultation with its Audit Committee, has appointed Windes & McClaughry Accountancy Corporation ("Windes") as the Company's independent auditor to replace Goldman Kurland Mohidin, LLP ("GKM"), effective September 30, 2010. "

Windes is a firm with a very good reputation in the US, a firm with more than 80 years of experience and a well know CPA....so know we have to ask this Hempton if maybe "his" friends know who they are......maybe not...they dont know nothing at all...just rumors and dobious intentions, as a short seller he just want to make a profit destroying a company name...

and there is Windes at the 6 firm in the West of the US and 123 in the ranking. not bad at all!!

From their website:

"Acknowledged by Inside Public Accounting as one of the Top 25 Best of the Best Accounting Firms in the Country, Windes & McClaughry is a recognized leader in the field of accounting, assurance, tax, and business consulting services. The firm was founded in 1926. Headquartered in Long Beach, California, the firm also has offices in Orange County and the South Bay"

So we are talking of a AAA auditor now, that has a good reputation and this are very great news for the company in the long run.

So this is another good news for the stock

Now they have the work to clean a name that was put in doubt for a malicious short seller and they are doing a great job.

Also they make a conference last week to answer all the questions that this person make and the answer where very clearly and well made.

So i think this is a wonderful move, this is proof of the company in the long run and we think that this is a very good opportunity in the long run.....this is not to mention the very atractive numbers that the company has and the good things about this investment opportunity

PD: there are also rumors of a takever due to the recent movements at the company to shield the board against that..

It's not so much that UTA hired a new accounting firm, but that the old one GKM quit after having just been hired one month ago. UTA sent out a press release announcing the hiring of Windes, but only informed the SEC in a filing that GKM went screaming for the exits so soon.

As it didn't provide a reason for leaving, according to UTA, one can only assume it took one look at what it was dealing with and decided to have nothing to do with it.

Yes, shorts can stir up trouble some time, but a lot of times they uncover the dirt longs would rather not look at. I'd tread carefully with this one.

i appreciate you comment, but, things have to be at a background first.

Before GKM quit UTA was at the eye of a hurricane created by a blogger...GKM is a tiny, tiny firm.....that firm cant stand this kind of trouble, also, that firm was one of the reason that hempton attack UTA....he ask who was that CPA?....

first, GKM hasnt even look at the UTA numbers...they havent begin with the audit process yet...so they dont find nothing...if they happen to find anytjing, The CPA duty is to inform the problem.....if an auditor find something shady they have to report that trouble...not quit...

GKM name was questioned also, so its better to make things clear and move on.....hire a better CPA and remove that doubts

other thing....we never know if they actually quit or maybe in some talks with UTA they ask them to quit.....maybe it was something that both agreed....

i dont see anything bad....they hired a better auditor, that gives the company confidence in the long run, and clear that argument that they have a shitty auditor to question,